In a significant development for the financial landscape of India, REC Limited, a powerhouse in the public sector and a Maharatna company operating under the Ministry of Power, has crossed a pivotal milestone. On May 3, 2024, the company was granted a green signal by the Reserve Bank of India, embodied by a ‘No Objection Certificate’, allowing it to lay the foundations for a wholly owned subsidiary in the heart of Gujarat International Finance Tec-City (GIFT) located at Gandhinagar, Gujarat—one of the country’s premier International Financial Services Centres (IFSC).
This strategic initiative comes at a time when REC, a prominent Non-Banking Financial Company (NBFC), is actively broadening its portfolio in quest of higher ground in terms of market growth and diversity. The subsidiary is set to immerse itself within the dynamic expanse of GIFT City, which promises to offer a rich soil for various financial services. The spectrum of activities this subsidiary is looking to delve into involves, but is not limited to, lending operations, investment, and an array of other financial services aimed at propelling the company to new horizons.
Surrounded by an atmosphere of innovation, GIFT City emerges as a magnet for international financial endeavors, complete with state-of-the-art infrastructure ready to cater to the ambitious aspirations of financiers around the globe. With this conducive environment, REC is all set to mark its territory in the international market, benefiting from the vast opportunities that GIFT City offers to finance companies aspiring to achieve global excellence.
The REC Limited’s Chairman and Managing Director, Shri Vivek Kumar Dewangan, has been an optimistic advocate for this expansion, underscoring the vast potential that GIFT City holds. He envisions this move as a significant leap forward, not just for REC but for India’s energy sector as a whole. He anticipates that REC’s presence in GIFT City will open new business vistas and in doing so, will invigorate the country’s power and infrastructure sectors.
Shri Dewangan’s forward-looking perspective heralds a new chapter for REC, suggesting that the move to GIFT City is much more than geographic. It is a strategic maneuver designed to catalyze REC’s long-standing mission—to nurture and elevate the growth of India’s energy framework—while establishing a robust international presence. This aligns with the company’s overarching goal of serving as a key player in steering the developmental course of the Indian power sector into a new era of global interconnectivity and competitive edge.
The GIFT City-based subsidiary is expected to operate within a regulatory framework favoring international business, fostering a climate ripe for innovation and financial ingenuity. The advantages of such an ecosystem include tax benefits, ease of capital movement, and business-friendly regulations that further sweeten the deal for REC’s upcoming subsidiary, which aims to tap into and flourish amidst these favorable conditions.
Through the lens of economic development and strategic growth, it becomes evident that this foray into GIFT City is substantially more than REC’s response to the evolving global financial services landscape; it is a clear indication of the company’s commitment to staying ahead of the curve. By integrating its financial expertise with the opportunities present in a high-paced, international financial hub, REC Limited is setting the stage for an amplified role in the energy sector’s future.
The groundwork laid by the Reserve Bank of India’s approval thus marks a pivotal juncture for REC Limited—an institution that stands to redefine its trajectory as it steps into the realm of international finance, all while fortifying its commitment to powering India’s developmental engine, setting a benchmark for PSUs stepping onto the world stage.
